Consider the production of textiles and commercial aircrafts in Canada and Bangladesh.

2.1. Which country would you expect to be relatively labor-abundant, and which is capital-abundant? Why?

2.2. Which industry would you expect to be relatively labor-intensive, and which is capital-intensive? Why?

2.3. Draw production possibilities frontiers for each country. Assuming that consumer preferences are the same in both countries, add indifference curves and relative price lines without trade to your PPF graphs.

2.4. What do the slopes of the price lines tell you about the direction of trade? How do the findings relate to the predictions of Heckscher-Ohlin theorem?